Container vendors deal with supply chain, labor and raw materials issues, which in turn affects growers and retailers

In her 14 years as hard goods buyer in the nursery industry, Cheryl Atwater has seen economic cycles come and go, plant trends peak and drop off and markets surge and decline. Never, however, has she experienced anything like what she is seeing today.

“I never thought I would be tracking vessels in the Pacific Ocean trying to predict when my containers would be arriving,” said Atwater, hard goods planner and buyer for Smith Gardens in Bellingham, Washington. “I’ve never seen a year like this one.”

Market forces at play in the nursery industry today have created what nursery container suppliers and buyers are calling a “new reality,” as buyers struggle to get containers in a timely fashion and the lead times for orders is being pushed into territories nursery veterans never expected.

“We are finding that the lead times are bumping out further and further and further,” Atwater said. “You have to guess at what you are going to be doing next year. And our box stores that we supply don’t always predict as far out as we do.

“It is a crystal-ball effect,” she said.

‘We’re busy’

Nursery container suppliers said several factors have aligned to create the industry’s current dynamics, including, most prominently, increased demand.

“We’re busy,” said Chris Anderson, vice president of Anderson Pots in Portland. “We’ve been probably busier than we’ve ever been for the last year straight, and we have been steadily busy since the summer of 2020. We slowed down a little bit in December of 2021, but as soon as we did, people started ordering. So, it was more like a couple of weeks off more than anything else.”

Suppliers also pointed to labor issues as a factor affecting their ability to meet orders.

“Labor is a problem,” Anderson said.

“The work ethic seems to have gone away for some people,” said Wayne Hinton of RootMaker^® Products Company LLC in Huntsville, Alabama. “I called one person who does some contract work for me about a truckload I needed in Macon, and he said, ‘Well, it depends on whether somebody shows up for work.’ He has a real problem,” Hinton said.

Then there are supply-chain issues, particularly at West Coast ports.

“When you see things that we are used to clearing the port in one to two weeks taking four to six weeks to clear, and then they can’t find a chassis to load the container onto and so you are waiting another week, that was a surprise on the front end of this whole thing,” Atwater said.

“Fortunately, we are up in the Northwest. Seattle did not get as backlogged as L.A./Long Beach did,” she said. “We definitely saw a lot longer wait times, though.”

Then there are issues with sourcing raw materials.

“There are probably four things that are affecting our industry,” Hinton said. “There is increased demand for plants, which always increases container needs. A lot of the people that are sourcing pots from somewhere else, especially China, have had a real problem. Since RootMaker containers are all made in the USA, we avoid this problem. The labor shortage is another one, and a plastic shortage.

“Those are four real problems that are affecting the industry,” Hinton said. “It is kind of a perfect storm of hurdles.”

Meeting demand

Hinton said that, so far, RootMaker has been able to find the raw materials it needs to fill orders. “So far,” he repeated.

“It’s been interesting, but so far, we have been able to find the materials we need to meet our orders,” Hinton said. “You take it one day at a time really on supplies and try to make sure that your inventory of raw materials is sufficient to carry you for six to eight months, if need be. And if you don’t actually have it on-hand, you have it committed to and in the pipeline.

“We have good suppliers” he added. “They have kept us in inventory. But it has been a challenge, particularly last summer when finding polypropylene recycled resin was really trying. We’d go to our normal suppliers and they would not have anything. Fortunately, we have a long history with the people I work with, and so when they would get something, I would get a call and they would say, ‘I’ve got five trailer-loads, do you want it?’ And I’d buy it.

“We’ve been lucky,” Hinton said.

Anderson Pots also has been able to get the raw materials it needs to fill orders, but not always in a timely fashion.

“Some of the material that comes in from out of state, for small orders or specialty orders, are hard to get or have months of lead time,” Anderson said. “But our main pellets are coming from Oregon, so right next door, so to speak.

“That said, everything else for us is a long lead time,” Anderson said. “If we need a machine repair, or we need a mold repair, or we need any sort of equipment, it might take four to six months to get it.”

Adding to difficulties for suppliers is price volatility, particularly last year.

“It basically doubled,” Anderson said of the cost. “This year has been pretty stable, so far, but who knows if that will hold.”

Order ahead

Asked what advice they would give nurseries looking for container supplies, suppliers said that the key is a long lead time on orders.

“We are advising nurseries to look as far into the future as they can for their requirements,” Hinton said. “They don’t have to get it 100% right, but they need to have a good percentage of what they think they will need on order so that we can schedule the raw materials we need to make it.

“It makes it easier for us to find the materials, should they get as scarce as they were last summer,” he said. “It allows us to search the market if we have to. And it allows our suppliers to gather the raw materials that we need if they know we are going to need it in the fall.”

“It is all about scheduling,” Anderson said. “The sooner they can give us an order and we can schedule it, the better. Get those orders in early. It is hard to project out that far, but that is the game we are playing.”

Hinton noted that, to date, Rootmaker has been able to meet orders, although it hasn’t been easy.

“We are having to work longer hours in order to get them done,” he said. “It is not as timely as I would like in some cases, just because the orders are larger and we have more customers.

“We are having to constantly adjust our production,” Hinton said. “It is just different. It takes more of an effort to get it all done in a timely manner. But so far, we have managed to do that. We have good folks helping us out in terms of our employees and the people we contract with.”

Projecting out

Buyers, like Atwater, meanwhile, are doing what they can to keep their nurseries supplied with containers.

“Some containers are harder than others to come by,” Atwater said. “The larger sizes seem to be pretty impacted. The trade gallon is booked out fourteen months or more everywhere you look in the U.S. right now.

“It is really incredible,” she said. “I’ve never been told ‘no’ so much in my life.

“It is really difficult from the buyer perspective. You are just trying to grab a few more cases of something, or another pallet of something to finish out an order, and sometimes you can’t get it,” she said. “There is no floor inventory anymore. It is all made-to-order.”

For years, Atwater said she ordered material three to four months in advance. This year, as of early May, Atwater  already ordered “probably 95% of what we are going to need for next year, just based on predictions.”

Atwater  started increasing her lead time on orders last fall. “The backlog in the ports got really bad, and so we starting jumping ahead at that point,” she said. “I ordered everything in December for the next year, and since then, the lead time has gotten longer.

“I’ve had a lot of gut-wrenching moments, and then you pour the cost increases on top of that, with fuel and freight and the cost of resin,” Atwater said. “So, you are paying more and you are having to go further out ahead, and it is a variable market. You have an idea of what you are going to pay, but it is probably going to go up.

“But we are rolling with it,” she said, “because that is all we can do.”

Mitch Lies is a freelance writer covering agricultural issues based in Salem Oregon. He can be reached at [email protected].